Coyotes de l'Arizona Episodes #120987645399287435637

City makes final payment to NHL  

Posted: Thursday, September 29, 2016 12:00 am | Updated: 8:48 am, Thu Sep 29, 2016.

By DARRELL JACKSON, Staff Writer | 0 comments

Three years after agreeing to pay the National Hockey League $50 million in order for the team to remain in Glendale while the league ran the team, the city deposited $5 million deposit into an escrow account as the final payment was made Sept. 20.

The Coyotes were placed into bankruptcy in 2009, after former owner Jerry Moyes filed for protection after a failed attempt to sell the team. The NHL purchased the team out of bankruptcy court and ran the team for two seasons.

“Per the agreement dated Sept. 20, 2013, the final $5 million payment from the city into the escrow account occurred yesterday, Sept. 20, 2016 (defined in the agreement as the third anniversary date),” said Assistant City Manager Tom Duensing. “The NHL can withdraw the final $5 million payment from the escrow account on or after Sept. 20, 2017 (defined in the agreement as the fourth anniversary date).”

Council held a special meeting Sept. 20, but went directly into executive session for, “consideration and possible action regarding final escrow payment to the (NHL).”

While the league cannot withdraw the money from the account until Sept. 2017, Duensing said, “any and all accrued interest belongs to the city,” but he wasn’t sure the amount of interest that would be accrued on the escrow account.

Duensing said the interest, which had been approximately $7,500 since fiscal year 2011-12 through FY 15-16, is payable to the city.

“The ability for the NHL to withdraw the final $5 million one year after the city deposit and the fact that any interest goes to the city is simply part of the Sept. 20, 2013 escrow agreement,” Duensing said. “If the payment were made directly to the NHL, there would be no deposit made to the escrow, and therefore, no interest earned and paid back to the city.”

“This final payment had no impact on the adopted budget as it was already appropriated,” Duensing said. “This payment was also referenced and planned for in the last three, Five-Year Financial Forecast presentations which were Dec. 17, 2013; Dec. 16, 2014; and Dec. 15, 2015.”

While the original payments to the NHL caused the city to remove money from the Water and Sewer fund ($15 million) and general fund ($5 million) the money has been paid back to both funds since fiscal year 2012-13, years after council directed the city to do so.

“Annual transfers from the general fund back to the water and sewer fund have been made since FY12-13 and will continue to be made per council direction,” Duensing said.

IceArizona purchased the team from the NHL in 2013, but the sale was contingent upon a lease agreement with the city to run then Jobing.com Arena (now Gila River Arena). After two years of the city paying IceArizona $15 million to manage the arena, the city cancelled the contract, claiming, “it was entitled to terminate the agreement because two former city employees, Craig Tindall and Julie Frisoni, were involved in securing the deal and later worked for the Coyotes.”

On July 23, 2015, it was announced the Coyotes and Glendale City Council had agreed on a resolution announcing they had agreed to a two-year deal for IceArizona to manage the arena for only $6.5 million per year.

RS&E purchased the team for an announced sale price of $170 million, putting down $45 million provided by RS&E, received a loan of $120 million from the Fortress Investment Group (which was repaid by the arena management fee Glendale paid the team to run the arena), and an additional $85 million loan from the NHL.

RS & E acheté l'équipe pour un prix de vente annoncé de 170 M $, en mettant 45 M $ fourni par RS & E, un prêt de 120 millions $ du groupe Fortress Investment (qui a été remboursé par les frais de gestion de l'aréna de Glendale ) et un prêt de la LNH supplémentaire de 85 millions $.

IceArizona managed the Coyotes and the arena before the city cancelled the contract and has been talking about leaving Gila River Arena for nearly a year with no announcement, after telling fans that they would make one by the end of last season.

IceArizona a géré les Coyotes et l'aréna avant que la ville annule le contrat

“This final payment satisfies the original agreement between the City and the NHL,” Duensing said. “No additional city payments are due under this agreement.”

AEG took over management of Gila River Arena this year, after agreeing to a contract with the City of Glendale.

 

Glendale Makes Last Payment to NHL by Zach Spedden on September 30, 2016 in Hockey, NHL  

Last week the City of Glendale completed a multi-year, $50 million payment to the NHL concerning the status of the Arizona Coyotes. 

The debt between Glendale and the NHL stems back to one of the most tumultuous periods in the Coyotes’ history. In 2009, the team–then known as the Phoenix Coyotes–was put into bankruptcy by owner Jerry Moyes. After a dispute involving several parties, the NHL reached an agreement to buy the Coyotes.

Since the team had been eyed for a move to Hamilton, ON during this time period, the NHL worked out an agreement with the City of Glendale to lease Jobing.com Arena (now Gila River Arena) and keep the Coyotes in Arizona. One of the terms of that agreement was that Glendale would pay the league for operating the arena and assist in covering the franchise’s debts, with the two years the NHL was at the helm of the Coyotes prompting a total of $50 million.

L'équipe avait regardé pour un déménagement à Hamilton ON. Au cours de cette période, la LNH a élaboré un accord avec la Ville de Glendale pour la location Jobing.com Arena (maintenant la river Gila Arena) et de garder les Coyotes en Arizona. Un des termes de cet accord était que Glendale verserait a la ligue, pour faire fonctionner l'aréna et aider à couvrir les dettes de la franchise, pour les deux ans que la LNH était à la barre des Coyotes, la ville devait payé un total de 50 millions $.

Glendale paid the league over a period of several years, and recently announced that its final payment was completed. More from the Glendale Star:

“Per the agreement dated Sept. 20, 2013, the final $5 million payment from the city into the escrow account occurred yesterday, Sept. 20, 2016 (defined in the agreement as the third anniversary date),” said Assistant City Manager Tom Duensing. “The NHL can withdraw the final $5 million payment from the escrow account on or after Sept. 20, 2017 (defined in the agreement as the fourth anniversary date).”

Council held a special meeting Sept. 20, but went directly into executive session for, “consideration and possible action regarding final escrow payment to the (NHL).”

While the league cannot withdraw the money from the account until Sept. 2017, Duensing said, “any and all accrued interest belongs to the city,” but he wasn’t sure the amount of interest that would be accrued on the escrow account.

Alors que la ligue ne peut pas retirer l'argent du compte jusqu'à septembre 2017, Duensing a dit, «tous les intérêts courus appartiennent à la ville»,

Duensing said the interest, which had been approximately $7,500 since fiscal year 2011-12 through FY 15-16, is payable to the city.

“The ability for the NHL to withdraw the final $5 million one year after the city deposit and the fact that any interest goes to the city is simply part of the Sept. 20, 2013 escrow agreement,” Duensing said. “If the payment were made directly to the NHL, there would be no deposit made to the escrow, and therefore, no interest earned and paid back to the city.”

The payment was based on the number of years the NHL owned the team. Essentially, Glendale paid $25 million each for both the 2010-11 and 2011-12 seasons.